Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : The Critical Investing Workshop -- Ignore unavailable to you. Want to Upgrade?

To: bonnuss_in_austin who wrote (33067)	10/3/2000 3:51:11 PM
From: bonnuss_in_austin	Respond to of 35685

ALERT! ORCL...full-serve broker hearing... ...rumors RIGHT NOW of possible downgrades coming on it ... guy's with PW. I just dumped IBM I've had for four years. b-i-a ###

To: bonnuss_in_austin who wrote (33067)	10/3/2000 3:52:45 PM
From: robwin	Read Replies (1) \| Respond to of 35685

Hi Bon, I found a really good site that provides a detailed discussion of the pros and cons of CC writing, when I get home, I will post or send it to you.... The basic problem is that you can't have your cake and eat it too (some people on the old Porch pointed this out but it was generally glossed over)...You buy and then simultaneously write for a fixed return but then the stock invariably takes off on you or in the alternative drops below your new cost basis...I know the counter-arguments is that you simply find another stock after being called or roll up and out in the case of a steep rise... in the case of a precipitious drop, you buy back the calls and roll down and also average down on the underlying (doesn't sound stress free to me!)and carefully watch the stock price.. I just don't think it beats LTB&H in terms of stress free investing or returns...the site that I found was actually a service that provides recommendations for CC's and when I looked at their track record, their results would have been far better had all the picks been simply bought and held for 6 months to a year...mind you, I will say the CC writing works well on a sideways moving underlying but with the present volatility, you are not going to find many stocks that fit this criterion and are quality issues and that pay a decent premium... I have tried with some of my TXN with some October calls ..haven't decided whether to buy back yet...if I do I will wait to see if the stock price stabilizes...